Gold fluctuate as dollar strengthens and Trump’s impact looms ahead of inflation data and Fed signals
Gold prices have declined recently, facing selling pressure due to the strong dollar and increased risk appetite among investors following Trump’s victory. Gold reached a two-month low on Tuesday but recovered slightly by 0.5% to $2,609.90, while December gold futures dropped by 0.4%, settling at $2,615.70.
Prices improved during Asian trading on Wednesday as the rapid rise of the dollar paused. Market attention now shifts to Consumer Price Index data, expected to provide insight into inflation trends and guide the Federal Reserve’s monetary policy. Experts anticipate inflation levels to remain elevated in October.
Metals saw a partial recovery on Wednesday, with platinum futures rising 0.7% to $960.10, while silver futures increased by 1.1% to $31.108. This slight improvement supports investor expectations of greater stability in metal markets, though anticipated interest rate hikes may reintroduce pressures.
Amid rising inflation and steady economic indicators, the President of the Minneapolis Federal Reserve made statements raising concerns about future interest rates, warning that high inflation may prompt the Fed to pause monetary easing temporarily. Despite a cumulative 75 basis points rate cut over the past two months, the Fed President’s comments suggest reconsideration of the expected December rate cut.
In industrial markets, copper prices have experienced a series of declines as new financial measures from China, the world’s largest copper importer, disappointed investors. Copper futures on the London Metal Exchange dropped by 0.1% to $9,137.50 per ton, while December contracts fell by 0.2% to $4.1390 per pound.
With Trump’s commitment to imposing high tariffs on Chinese imports, analysts expect a negative impact on the Chinese economy if these policies are implemented, posing challenges for China and adding pressures on metal markets.
